1. A.C.> A.R 4 1.

Two firms

2. Monopoly 2 2. Multiple products

3. Excess capacity 5 3. Single products
4. Experimental pricing 6 4. Low cross elasticity of
demand
5. High cross elasticity of
demand
6. Trial and error method
The production function can be
explained by :-

a) 1Law of variable proportions

1Laws of returns to scale
b 1Optimum combinations of inputs
) Total Revenue & Total Cost curve

c)
d
)

The effective solution to the problem of internationalizing of

externality involves :-

a) Government action
Private action providing
b correctives
) Externality taxes
Subsidies by the
c) government
d
)
Marks : 2

24. Economists call all human resources mental, physical, inherited and acquired as :-

a) 1Entrepreneur
Labour
b Capital
) Assets
c)
d
)
The phenomenon of waste of resources is also termed as involuntary un employ
ment of resources
 True
False

33. The subject matter of Micro economics includes the study of :-

a) 1An individual consumer

1Particular market for a given commodity
b Operation of a firm
) 1Major economic issues, problems & policies
c)
d
)

Marks : 2

36. Effective Demand covers :-

a) Consumption outlay for the households

Investment outlay in the private sector
b Government’s spending for consumption as well as investment
) How a consumer effectively demand the good in the market
c)
d
)
. Diamond 1. Changes in quantity demanded

2. Variation in demand 2. ED > 1

3. Index number 3. Snob Appeal
4. Rigid demand 4. Statistical device
5. Perfectly elastic demand
6. E.D. = 0
Marks : 2

44. The city of Ludhiana has

developed a big market for :-

a) Textiles
Silk
b Bangles
) 1Hosiery
c)
d
)
Managerial Economics 1 1. Prescriptive
in nature
2. Resources
3. Division of society’s output of goods and services
4. Motor cars
5. Wants
Public utilities such as railway or
cooking gas supply companies
2. Monopsony is the monopoly
3. In oligopoly market, price
4. Under monopolistic
competition
5. The price policy of a public
enterprise should be such as
5 2. Insatiable
3 3. The theory
of distribution
4 4. Tangible
goods
2 5. Alternative
uses
4 1. expenditure is incurred by the firms
on cross transportation
2 2. from buyer’s side
5 3. to enable it to operate at the lowest
cost possible and maximise efficiency
1 4. are allowed under the law to make
price discrimination
3 5. tends to be rigid at the kink on the
demand curve